The impact of Covid’s blockade on 2020 emissions has given new relevance to the movement in the 1970s. In Spain, where a 2016 poll found that 37% of people prefer to ignore or stop growth to help the environment, members of the ruling coalition recently supported degrowth as a policy. In France, the former Minister of Ecology called it “the only real option” last year.
On the other side is the libertarian ideology behind cryptocurrencies and decentralized finance (DeFi). Inspired by the financial crisis 15 years ago, the ideal world of semi-anonymous networks that reject centralized authorities such as banking systems and governments as obstacles to wealth and prosperity and instead require a trusted third party. We are promoting.
Covid fueled this fateful “cypherpunk” story and warned frustrated locked-down traders who had run out of time to escape hyperinflation and financial mismanagement by the elite. The results were visibly toxic, from hacking and fraud to waste of energy and false speculation, but evangelists continue to promise future rewards to those who keep their faith.
Degrowth and DeFi are different movements with different histories, but as Venezuelan and British economist Carlota Perez say, they are becoming increasingly identifiable as the new economic rebellion of our time. “Degrousers want to eliminate capitalists, and crypto fans want to eliminate the nation,” she told the French magazine L’Express in June, instead financially to reduce inequality. And called for the redistribution of technical benefits.
Perez has a point. Degrousers have the right to attack unsustainable consumption habits and slow emission reduction rates. However, it downplays the ability to invest and innovate to do more at less cost, such as reducing carbon dioxide emissions while extending product life. Government policies and subsidies are important for decarbonization, but the total command system is not a panacea. The silver lining of the pandemic was not a spectacle of social cessation, but a public-private moonshot development of the mRNA vaccine.
Another issue is politics. If most governments are a little rushing to offer degrowth as a voter policy, it is partly difficult to understand whether growth and deprived states can reliably distribute them. Because. Witness the angry reaction of several countries, including Spain, to the European Commission’s demand to reduce gas consumption by 15% across the European Union. many. Social cohesion is important.
When it comes to cryptocurrencies and DeFi, knocking out guardrails and central authorities is certainly an even more devastating recipe for inequality, even if the perception that the financial system is full of self-transactions and inefficiencies is true. Cryptocurrency booms and bust volatility have exacerbated, but are not limited to, the effects of inflation. With Bitcoin, El Salvador has so far lost more control over its financial future. Without a welfare state to protect workers during Covid, society would have fallen into Hobbes’s free state.
Just as the Degrouser ignores the natural urge to status and progress, the Defire ignores the natural urge of malicious actors to abuse unregulated systems. Insider trading allegations against former employees on the NFT marketplaces OpenSea and Exchange Coinbase, and the tragic stories of those who lost money on deposits in Celsius show how asymmetric crypto profits are.
Defective utopia isn’t just for Millennials / Gen Z. The end of the Cold War was characterized by confidence in the “end of history” of the free market, but Davosset’s attachment to “stakeholder capitalism” was humbled by ESG greenwashing.
A better counter-argument can be found in the book “Growth For Good” by economist Alessio Terzi. The book calls for an energy transformation that requires government support, international coordination, social cohesion, and leaves no one behind, without refusing to grow. “The only way to achieve this climate change is when society as a whole is involved,” he says.
Or, as Brazilian video game developer Mark Venturelli recently mentioned, the solution to economic inequality is more reliable than wasting national energy in an attempt to bypass trusted intermediaries. It’s about coming up with a human-centered intermediary. As economist Eswar Prasad points out, central bank-issued digital currencies can offer such benefits.
This may not be a satisfying brick from the window of the saying, but it is reminiscent of one explanation of Perez’s worldview as “economics of hope.” And if there is one thing that young people supply more than older people, it is optimism.
More from other writers in the Bloomberg Opinion:
Light is extinguished due to crypto laser eye glyphter: Lionel Laurent
Crypto Loves its Shadow Banks: Matt Levine
Four Ancient Truths That Help You Live Modern Life: Andreas Cruz
This column does not necessarily reflect the views of the editorial board or Bloomberg LP and its owners.
Lionel Laurent is a Bloomberg Opinion columnist covering digital currencies, the European Union and France. He was previously a reporter for Reuters and Forbes.
More stories like this are available at bloomberg.com/opinion